Agricultural flat rate scheme (AFRS) ― operating the scheme

Produced by a Tolley Value Added Tax expert

Value Added Tax

Guidance

This guidance note covers how to operate the agricultural flat rate scheme (AFRS). The scheme is sometimes also referred to as the famers’ flat rate scheme and the flat rate scheme for farmers.

For an overview of the AFRS more broadly, see the Agricultural flat rate scheme (AFRS) ― overview guidance note.

For in-depth commentary on the legislation and case law relating to the operation of the AFRS, see De Voil Indirect Tax Service V2.194 and V2.197.

Operating the AFRS - the basics

A farmer operating the agricultural flat rate scheme (AFRS) does not recover input tax on their business costs. Instead, it charges a flat rate addition of 4% on its farming activities when it makes supplies to VAT registered customers. The farmer retains this addition, in effect compensating for the lack of VAT recovery.

The VAT registered customer who is charged the flat rate addition may also recover this as if it were normal input tax.

No VAT or flat rate addition is charged by the farmer

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Owner-Managed Businesses

Wholly and exclusively

Wholly and exclusivelyFor both income tax and corporation tax purposes, one of the fundamental conditions that must be satisfied for an item of expenditure to be deductible, is that it must incurred ‘wholly and exclusively’ for the purposes of the trade, profession or vocation. References to CTA

14 Jul 2020 14:00 | Produced by Tolley Read more

Owner-Managed Businesses

SEIS and EIS ― overview

SEIS and EIS ― overviewThe seed enterprise investment scheme (SEIS) and enterprise investment scheme (EIS) are very similar schemes which offer substantial tax incentives to investors in companies which qualify. The tax incentives for SEIS and EIS investments are intended to encourage investment in

14 Jul 2020 13:31 | Produced by Tolley Read more

Employment Tax

Subsistence expenses

Subsistence expensesIntroductionSubsistence is the amount incurred as a consequence of business travel. Typically it relates to accommodation and meal costs incurred. These amounts are allowed because they are associated with the necessary travel which is not to a permanent workplace. See the Travel

14 Jul 2020 13:43 | Produced by Tolley in association with Philip Rutherford Read more

UU��ֱ��